[Editor's Note: The following summary was included in the report on "The Study of the Administrative Structure and Expenses of Higher Education in Montana" (1993) by MGT of America, Inc., Olympia, WA.]
This study is a review of the administrative structure of the Montana University System (MUS) and an analysis of the growth and costs of administration. As its title indicates, it includes a review of the structure of the system as well as the specific units and activities which create or result in costs. In this area, the study examines the interrelationship of the units and overall issues which are within its scope.
The recommendations contained in this study are those which the study team feels will improve the operation of the system (including areas where administration needs to be strengthened), improve efficiency, explore the potential for use of telecommunications in administrative operations, and which will result in long or short term administrative cost reductions. In view of the current budget problems facing the State of Montana and the university system, it is important to point out that the study does not attempt to do a number of things, including:
address the merits of specific budget proposals;
solve the budget problems facing the MUS;
deal with academic program termination or institutional closure;
review salary levels of administrative personnel; or
address access or tuition and fee policies.
In addition, the study report does not address items or issues outside its scope even though they might have a potential for cost reductions. That is a matter more appropriately addressed in other studies.
Although Montana's constitution and statutes envision the MUS as a single university, the units within the "system" have traditionally functioned more like a loose confederation. Each institution has evolved relatively independently over time. This historical independence has contributed to a lack of common administrative systems and a poorly defined role for the Office of the Commissioner. Until the issue of control and governance is resolved, the ability to find true and long term solutions to administrative issues will be difficult and parochial interests will likely continue to affect the development of the system. We endorse the recommendation of the Commissioner [Hutchinson] that the Board direct the Office of the Commissioner to prepare a plan for significant structural change that "will enhance delivery of post-secondary educational services in Montana" to be presented to the Board by October 1, 1993. In this context, we have suggested an approach which focuses on functional consolidation of services and a sharpening of the role of the Office of the Commissioner.
In regard to the costs of administration, we believe that our findings dispel the notion that these costs have grown disproportionately over the past several years. In fact, based on our analysis, administrative costs expressed in constant 1987 dollars have increased only slightly (less than one percent) while student FTE enrollment has grown approximately five percent. In addition to reviewing changes over time, we examined the relationship of the MUS to national and peer institution data. Although making some suggestions for improving the peer data, we found that expenditures for administrative budget programs were below national or peer averages. The only exception was the Student Services program where the higher than average expenditures (in the four-year units) were due to support for intercollegiate athletics.
It is our conclusion that the size and costs of administration in the MUS have not changed disproportionately to enrollment growth and are below most peer institutions and national averages. The breadth and depth of our analysis make this conclusion compelling.
As part of our study, we visited every institution in the MUS and met with more than 125 individuals to learn about programs and the status of operations and workload. In addition to our interviews, we sought to observe the general operating environment and conditions on each campus. Site visits were conducted in December and January, prior to completing our review of the peer data. Thus, visits were conducted without prejudice regarding the status of the size and/or costs of administration in MUS institutions. Our findings from the site visits confirmed subsequent peer review conclusions that, overall, MUS units are conservatively staffed. In our opinion, there is very little "fat" to trim. Therefore, although our analyses have identified some positions which may not be needed, there is no gold mine of administrative savings which can be tapped without significant impact on services.
In the report, we discuss where we believe the greatest potential savings opportunities exist. These include:
Consolidation of administrative functions at designated institutions through "affiliation agreements" to reduce costs and take advantage of economies of scale and implement common administrative systems at those sites or, in certain instances, through the Office of the Commissioner.
Reducing state support for intercollegiate athletics to a level more commensurate with the peer institutions. Although politically sensitive, these reductions will have the least impact on the level and quality of instruction that can be offered.
Eliminating college and university recruiting and marketing efforts while still providing necessary information to prospective students. Current efforts contradict existing state fiscal circumstances and policies designed to control enrollment.
Four-year institutions located in the same city as vo-tech centers providing key administrative services thereby reducing administrative staffing requirements at the centers without increasing staff at the four year institutions. Although it will be argued that the workload associated with the 300 to 600 students per center cannot be accommodated, we believe the colleges and universities can, in the long term, absorb these functions with existing resources.
Taking advantage of technology in automation and telecommunications to reduce costs of both administration and instruction. In this section we offer several recommendations designed to allow the state and the MUS to make greater use of the potential offered by telecommunications.
Developing a more fair and equitable means of distributing grant and contract research overhead to recognize added workload due to growth in research volume.
Eliminating the RERS system while assuring accurate position reporting.
Carefully examining all positions which have been established for a singular, time-limited purpose which has been accomplished in whole or in part, and considering those positions for termination prior to making expenditure reductions which will reduce services to students.
Reviewing the relatively few instances of functional duplication and/or overlap which were identified which offer opportunities for efficiency improvements and potential staff reduction.
Overall we have found the Montana University System to be one which has the opportunity to improve its long term functioning in an environment of limited resources by developing common systems, sharing resources, making greater use of telecommunications, and taking advantage of its unique opportunity to incorporate technical education into the system. At the same time, while there are short term savings which can be made, the administrative costs of the MUS are reasonable, have shown little constant dollar growth over the last several years, and compare favorably to peer institutions and national averages. As we note above, we have found no "gold mine" of administrative savings which can be tapped without reductions in services.